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Performance evaluation of three small firms' financing schemes in Tanzania

Performance evaluation of three small firms' financing schemes in Tanzania Purpose – The purpose of this paper is to shed light on performance evaluation of small firms' financing schemes with a view to assessing their potential for improving small firms' access to finance. Design/methodology/approach – An integrated methodology based on five commonly used methodologies is formulated to evaluate the performance of the three small firms financing schemes. This integrated methodology makes use of a number of selected performance indicators. Findings – The findings reveal strong performance in favour of Kilimanjaro Cooperative Bank (KCB) compared to the other two schemes. Furthermore, KCB financing scheme is demonstrated to be an important actor in the financial sector particularly rural parts of the country where mainstream financial services are generally not available. Research limitations/implications – Further research on performance evaluation of small firms' financing schemes could considerably extend the stock of knowledge in this area. It would be interesting for example to know what might be the findings if more financing schemes are included in a replication study given the ongoing growth in the number of these schemes in Tanzania. Coverage of a longer period, which allows for the use of more data for the same three financing schemes, might also produce a more robust set of results. Future research may also wish to focus on the development of a methodology that contains fewer shortcomings in assessing the performance of small firms financing schemes. Practical implications – The findings reported provide evidence on the possibility of improving small firms' access to finance in Tanzania through replication of KCB scheme/approach to other areas of the country where the environment is similar to Kilimanjaro region. The same might be applicable in other parts of Sub‐Saharan Africa. Originality/value – The findings reported on in this paper consolidate the stock of knowledge on performance evaluation of small firms' financing schemes. The possibility that replication of a scheme could improve small firms' access to finance, provide policy makers with a new dimension towards poverty reduction. Finally the use of accounting and organisational/institutional indicators as a measure of performance evaluation strengthens the role accounting could play in the future in developing a standardised methodology for assessing the performance of small firms' financing schemes. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Accounting & Organizational Change Emerald Publishing

Performance evaluation of three small firms' financing schemes in Tanzania

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Publisher
Emerald Publishing
Copyright
Copyright © 2006 Emerald Group Publishing Limited. All rights reserved.
ISSN
1832-5912
DOI
10.1108/18325910610675998
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of this paper is to shed light on performance evaluation of small firms' financing schemes with a view to assessing their potential for improving small firms' access to finance. Design/methodology/approach – An integrated methodology based on five commonly used methodologies is formulated to evaluate the performance of the three small firms financing schemes. This integrated methodology makes use of a number of selected performance indicators. Findings – The findings reveal strong performance in favour of Kilimanjaro Cooperative Bank (KCB) compared to the other two schemes. Furthermore, KCB financing scheme is demonstrated to be an important actor in the financial sector particularly rural parts of the country where mainstream financial services are generally not available. Research limitations/implications – Further research on performance evaluation of small firms' financing schemes could considerably extend the stock of knowledge in this area. It would be interesting for example to know what might be the findings if more financing schemes are included in a replication study given the ongoing growth in the number of these schemes in Tanzania. Coverage of a longer period, which allows for the use of more data for the same three financing schemes, might also produce a more robust set of results. Future research may also wish to focus on the development of a methodology that contains fewer shortcomings in assessing the performance of small firms financing schemes. Practical implications – The findings reported provide evidence on the possibility of improving small firms' access to finance in Tanzania through replication of KCB scheme/approach to other areas of the country where the environment is similar to Kilimanjaro region. The same might be applicable in other parts of Sub‐Saharan Africa. Originality/value – The findings reported on in this paper consolidate the stock of knowledge on performance evaluation of small firms' financing schemes. The possibility that replication of a scheme could improve small firms' access to finance, provide policy makers with a new dimension towards poverty reduction. Finally the use of accounting and organisational/institutional indicators as a measure of performance evaluation strengthens the role accounting could play in the future in developing a standardised methodology for assessing the performance of small firms' financing schemes.

Journal

Journal of Accounting & Organizational ChangeEmerald Publishing

Published: May 1, 2006

Keywords: Performance appraisal; Small enterprises; Financial services; Business development

References